This past week brought more bad news about the financial markets in the wake of the Fannie Mae and Freddie Mac government takeovers, including rumors of troubled financial firms about to go under. While chatter of this sort has existed for months, with a solid mix of accurate and inaccurate rumors, this week’s most talked about institutions included Merrill Lynch, Lehman Brothers and Washington Mutual – though a fair amount of disquiet has fallen on every financial firm that has posted a loss in the last few quarters.

One of the interesting things about the ongoing financial sector turmoil is how few firms directly address rumors like these, as well as other financial events, on their websites. Firms seem loathe to address the fact that the sub-prime and credit market problems might be affecting them. One of the few firms to have directly spoken about a possible demise in recent memory was E*TRADE, who posted an announcement on their public and private site homepages while rumors were swirling that the firm was about to go under. This brief announcement included a link to a detailed letter from E*TRADE’s CEO explaining the steps they had taken to ensure continued viability of the company and listing several relevant financial details. In effect, this letter was E*TRADE’s way of saying the reports of its death were greatly exaggerated, a line recently used to great effect by Steve Jobs.

 

In addition to talking about their own situation, banks can use these types of ad hoc online announcements to discuss the way other firms’ problems are affecting them, something that Van Kampen recently did. The firm posted a simple item discussing the take over of Fannie Mae and Freddie Mac and how it affected their portfolios. While their online posting about the Feds’ takeover was not very detailed, it is much more than most banks posted in relation to potentially the largest government bail-out in history.